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There are some weighty decisions coming for local government officials on property taxes and budgets. Plus, we have new census numbers: San Diego’s not growing that fast.
Every day, in the Voice of San Diego Morning Report, we include a section at the bottom called “In Other News.”
But … uh … what other news is there? What issue in our lives is not completely owned, framed, corrupted, afflicted or exaggerated by the coronavirus and the shutdown of our lives it’s delivered?
Even the issues that have nothing to do with coronavirus or health care are now deeply changed.
Think, for example, about vacation rentals. Remember when that was an actual politically charged issue?
We’re done thinking that, right?
(Or maybe they are? We’ll have a live experiment to see just how many of them return to the regular rental market and serve to ease rental housing costs.)
Anyway, here are a few other big decisions and issues peaking soon.
Assemblywoman Lorena Gonzalez and others, including Assemblyman Brian Maienschein, turned their attentions this week to San Diego County Treasurer Tax Collector Dan McAllister.
All it takes is a pandemic for people to start paying attention to the treasurer tax collector. It’s an elected position and McAllister has had it since 2002. McAllister is affable and ubiquitously present on the Kiwanis/Rotary/Optimist circuit.
“We sent a letter to our County Tax Collector asking him again to utilize his broad authority to provide relief from penalties to those who will be unable to pay their Property Taxes on April 10 because of this crisis. Many, in other counties, have been much more responsive,” Gonzalez wrote.
Many people – about 34 percent – have their property taxes paid by the lenders who gave them mortgages. So those will come in. Another large chunk pay in installments, and those will come in.
But more than 30 percent pay with checks mailed in or online or they drop them off. That’s the group we’re mostly talking about. Will they be able to pay?
More than 99 percent of people paid their property taxes fully each of the last five years.
“The last five years have been good because the economy has been good,” McAllister told the Politics Report Friday.
McAllister did not offer a blanket amnesty on property tax collections. He announced he would consider waivers on a case-by-case basis. He said it was up to the Legislature to change the deadline, not him. And the Legislature isn’t even scheduled to meet before then.
County Supervisors Kristin Gaspar and Jim Desmond and McAllister, along with City Councilwoman Barbara Bry, all asked the governor to intervene and change the deadline as an emergency executive order.
But it’s all trade-offs: The property taxes are immediately distributed, and even a short delay could really put the squeeze on an agency like the city of San Diego, which will have to make a massive payment to its pension system in July. If the property tax payments are late and the hotel taxes are gone, well, they better have sold a lot of cannabis lately because they may need some cash.
“It could have a railcar-derailing impact on everyone’s ability to pay their obligations,” McAllister said.
State Senate President Pro Tem Toni Atkins seemed hesitant to put off property tax payments in a statement she gave to the Union-Tribune: “April property tax payments are vital to local communities’ ability to keep hospitals open and first responders on the job,” she wrote.
But there’s another, different trade-off: If 99 percent or more of the county usually pays by the deadline, then even a 1-2 percentage point drop would mean a significant hit to local school districts and cities. Last year, the county sent out property tax bills that totaled $6.9 billion. Two percent of that is $138 million.
And that brings us to the city of San Diego’s budget. Councilman Chris Cate told the Politics Report that the deficit, already projected to be bad, would at least be double, if not worse. Not only is the city losing hotel room taxes, which have plummeted to near zero. The city is losing in many other ways, too, places like SeaWorld won’t have many revenues, which impacts their rent payments. Same with SDG&E, which pays franchise fees based on how much power is used. If place like, say, large hotels and schools aren’t using a ton of electricity, it can all cascade and affect the city’s budget.
It’s just a complete fiscal nightmare.
The city and six of its labor unions have been in negotiations for new contracts. Obviously, this changes things. The talk of raises has abruptly shifted to furloughs and layoffs.
“We’ve added a lot of programs and staff over the past few years and now it’s time to determine what’s most important,” Cate said.
Cate pointed to increased arts spending, enforcement efforts on vacation rentals and the $10 million the city began spending on CleanSD, the program to clean up garbage, graffiti and other blights.
Council President Georgette Gómez said she has essentially stopped campaigning for Congress because of the weight of all these decisions.
“My campaign has really been put on pause. I’m the Council president for the city of San Diego so I’ve been working to really make sure we’re moving our city and continuing to move forward with critical operations,” she told our Bella Ross.
Our review of local governments that were best prepared for this sort of shock had the county among the best prepared. The billions in reserves a lot of people have demanded the county deploy now are going to be very useful for the crisis. But that may put some big plans on hold.
County Supervisor Nathan Fletcher, who had hoped to lead a major push on new spending for behavioral health programs (behavioral health is the combination of mental health and substance abuse treatment) said there’s going to be some tough decisions in coming months. For one thing, the county may have to make critical decisions about patient care and the availability of personal protection equipment for medical workers.
And then there will be impacts to the rest of their plans.
“We’re going to face a greater demand on our social safety net at a time of declining tax revenue. That will require a reassessment of all our priorities and planned investments,” Fletcher said. He may be willing to fight for behavioral health over other plans, though.
Dispatch from Bella Ross: Candidates for San Diego’s 50th and 53rd congressional districts are in agreement: The $2 trillion relief package approved by both the House and Senate this week is necessary to protect the U.S. economy while the number of confirmed coronavirus cases and deaths climbs.
In D.C., provisions providing bailouts to large corporations and the expansion of unemployment insurance proved to be the most contentious partisan dispute. Locally, the biggest disagreement, even among Democrats, related to how those corporations on the receiving end of some $500 billion worth of total loans should be held accountable — or if they’re being held accountable at all.
Congressional leaders said they hope a new inspector general at the Treasury Department will be assigned to oversee the distribution of the loans to big businesses and a congressional oversight panel will convene as well. There is, however, a provision in the bill prohibiting businesses with connections to executive officials, including the president, or their families from receiving loans.
Here’s what local candidates thought about it:
Georgette Gómez: She said the package was not perfect. “The fact that we’re giving a significant amount of money to corporations with no accountability is concerning, but there’s good items within it,” she said.
Sara Jacobs: She also emphasized that Congress was fulfilling the needs of big corporations and leaving small businesses at a relative disadvantage.
“For small businesses, they have to choose between a tax credit or an SBA loan, but big corporations are going to get the bailout and the tax credit,” Jacobs said. “I don’t think we should be putting small businesses at an unfair footing in regard to their larger competitors.”
Ammar Campa-Najjar: The Democratic candidate for the 50th, said he disagrees with claims that the program provides “no accountability” and that the version of the package that was approved on Wednesday was a stark improvement from Congress’s initial plan.
“I’m pleased with the amount of transparency and accountability that we’re putting on these major corporations for the $500 billion,” Campa-Najjar said. “It was a blank check a week ago and now there’s going to be an inspector general and a congressional board.”
Darrell Issa: The former congressman declined an interview request but issued a statement that is both supportive and critical of the stimulus package. He suggested the financial oversight was lacking.
“Workers and businesses are hurting, and the emergency bill is an important temporary measure to help ease some of the pain before our economy starts moving again,” Issa said. “However, the government is spending $2 trillion in taxpayer dollars and that has to be done with transparency and accountability. Misuse of this money is completely unacceptable.”
Campa-Najjar sees the transparency issue differently from other local candidates, but he said his top priority in Congress would be sending some stimulus to the economy as quickly as possible.
“I think we need to pass this bill without drama or delay,” Campa-Najjar said. “This is about bare necessities, not about a wish list from either party. I’m sure everyone wants to add more things, but really time is of the essence.”
It used to be a big deal in the world of urban affairs journalism when the Census Bureau released its annual population counts for counties and metropolitan areas.
This week, it was just nice to spend a few minutes thinking about something other than the coronavirus.
But there was some interesting news for San Diego in the numbers.
San Diego’s population grew. Barely. The county of 3.3 million added a mere 4,469 new people in 2019.
The annual growth rate of 0.13 percent was the county’s lowest of the decade. It was the fifth consecutive year that the county’s population growth has slowed down.
San Diego’s declining growth rate, though concerning, is not out of the ordinary.
The economist Jed Kolko, who has tracked the growth rates in different metro areas for years, separates counties into different buckets based on their size and the nature of their development patter, like urban counties, high-density suburbs, low-density suburbs and mid-size metros.
“Urban population growth has essentially stopped,” Kolko wrote this week.
His analysis showed that growth in urban counties is now at zero. The fastest-growing counties nationwide are low-density suburbs.
In all, 12 of the 53 metro areas that are home to more than a million people got smaller in 2019. Declining population is generally not the sign of a healthy, thriving metro area.
The new driver of slower growth in urban areas, Kolko wrote, is the decline in immigration.
In fact, San Diego, he wrote, would have been among those metros that actually shrunk in 2019 if not for growth from immigration.
Megan Wood contributed to this week’s Politics Report. So did Bella Ross. And Jesse Marx helped too. Do you have feedback or ideas for the Politics Report? Send them to firstname.lastname@example.org or email@example.com.